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A Third Power

A Third Power

June 25th, 2012 // 9:33 pm @

Michael Strong wrote, in his excellent book Be the Solution: How Entrepreneurs and Conscious Capitalists Can Solve All the World’s Problems:

“A short history of twentieth-century economic and political thought might be summarized as:

“Market Failure! Markets don’t work as well as the classical economists thought and therefore we must control them (1900-1960).

“Government Failure! Governments don’t work as well as democratic theorists thought, and therefore we can’t depend on them to do the right thing either (1960-2000).”

Markets are excellent for what they are for! Free markets create more wealth and distribute it more widely than any other economic model.

Under free markets we always witness a large middle class.

But the market doesn’t solve all problems in society.

Nor does government.

Neither markets nor governments solve everything.

Markets create more affluence and involve more people in prosperity than any other system, and governments are the most effective entity in protecting inalienable rights and maintaining laws that allow markets to flourish.

But there are a number of things governments should not do and markets will not naturally do, and these tend to be precisely the major challenges our society faces (and seldom solves).

If we are to effectively address society’s main ills (beyond a quality standard of living for most people and the protection of our rights and freedoms), people need to voluntarily take on the world’s ills and find ways to address them.

Charity, philanthropy, volunteer service, service project and social entrepreneurship (the creation of companies or projects with the specific goal of addressing societal problems) is vital.

Government is great for what it is for, but it becomes dangerous to all when it goes beyond its proper role.

Markets are fabulous for creating affluence and helping spread it to a large middle class, but they are not focused on fixing the various societal ills.

It is up to people to improve our world beyond the natural roles of government and markets.

The discussion nearly always centers around how government should do everything versus how government should do less and leave more to markets.

But those arguing for markets too seldom go out and really implement needed solutions in our communities and nation.

It’s time to get past the old Cold War argument.

Of course government should be limited, of course markets can do many things better than government, and of course markets depend on good government policy for safety and the rule of law.

But there is another piece to fixing the world: the non-governmental, non-market driven action of individuals who see a need and set out to make a difference.


odemille 133x195 custom Egypt, Freedom, & the Cycles of HistoryOliver DeMille is the co-founder of the Center for Social Leadership, and a co-creator of Thomas Jefferson Education.

He is the co-author of New York Times, Wall Street Journal and USA Today bestseller LeaderShift, and author of A Thomas Jefferson Education: Teaching a Generation of Leaders for the 21st Century, and The Coming Aristocracy: Education & the Future of Freedom.

Oliver is dedicated to promoting freedom through leadership education. He and his wife Rachel are raising their eight children in Cedar City, Utah.

Category : Blog &Culture &Current Events &Economics &Featured &Government &Leadership &Mission &Statesmanship

16 Comments → “A Third Power”

  1. Steven Montgomery

    11 years ago


    Great piece.

  2. Ammon Nelson

    11 years ago

    So a couple of questions came to mind as I read this article:
    Isn’t the essence of a free market that individuals see a need (or a potential to create value) and set out to make a difference, and are not hampered in their efforts by government over-reach? How is this different or separate from the free-market and government being limited to it’s proper role?

    How I understood what you are saying is: the third power is people proactively taking action, not just theorizing about what would be best.

    The Free Economy is just a theory and doesn’t work at all when it remains in newsletter articles and in the blog-o-sphere and when people have the mentality of waiting for “others” to make the changes happen. They need to take action and create the business, or organization which fills the gap between what should be and what is.

    Government being limited to it’s proper role is nothing more than rhetoric when people do nothing more than use it as a talking point for discussion and a point to which they can point to tell their elected officials exactly what is wrong with how they are doing things. They need to be actively involved in holding their elected officials accountable every day, not just once every year or so at the ballot box.

    In essence the third power of which you speak is people doing more than thinking and complaining about what needs to change and improve, and going out and “be[ing] the change,” correct?

  3. Keith

    11 years ago

    I often think what Sam Walton could have done if he had a better vision? Take a building and let local producers and creators within a 50 mile radius sell their products there. If a product is not made locally, then let that store (100% locally owned and run) network with another store in another territory to exchange each other’s products offered, thus creating a larger market for a local entrepreneur while decentralizing the retail giant in a way that creates more opportunity for more entrepreneurs. If anyone thinks the web is a level playing field, they are wrong. The costs for getting to the top of any search engine to be found are no different than trying to get on the shelf of a major retail outlet. It is simply too narrow of a gap for so many to fit.

    The new models are coming and the modern entrepreneur needs to be a statesman at the highest level to fight for these models in the same way our founding fathers fought for our constitution. Unless we decentralize corporate controls and unless we create models that truly liberate quality and invention, we are doomed to fall prey to a growing control grid better known as fascism, the merger of market forces (corporate influence peddling) with government. In a way, it is one thing to study the forms of government. It is another thing to study the many undiscovered forms of business organization. This is where the modern statesman is handicapped. This is also where the greatest protection of liberty and freedom will be secured in the coming years.

  4. Oliver DeMille

    11 years ago

    Right on, Ammon.

  5. Oliver DeMille

    11 years ago

    And, right on, Keith!

  6. Kris Bayer

    11 years ago

    You stated, “governments are the most effective entity in protecting inalienable rights and maintaining laws that allow markets to flourish.”

    I don’t agree with this and I do not think you can limit what you call government. They do not protect inalienable rights OR maintain laws for free markets. If there are laws regulating markets, they are not FREE. A friend of mine just got summoned to court for traveling freely, a right that the government does not want to protect because of the loss of revenue.

    A stateless society is needed. Markets need to be free. and private people contracting for private security can provide protection without the state. Has anyone read, The Voluntary City or The Enterprise of Law?

  7. Ammon Nelson

    11 years ago

    Now that is an interesting contradiction. First you state that you don’t think one can “limit what [one] calls government”, yet in the next sentence you do just that in saying that “governments do not protect inalienable rights or maintain laws for free markets.”

    Chaos never brought about anything of value. Order is required for value creation. Rules are required for order.

  8. Kris Bayer

    11 years ago

    Ammon, do you assume that there would be no order without government? I think we have all been trained to think that way.
    I believe God set up his creation with much order and we get to discover what those rules are. They exist whether we believe them or not and whether anyone states them or not. I believe there is a Higher Law than any government/political law.

    Regarding the contradiction, I am not sure what you are saying.
    Thanks for the thoughts.

  9. Ammon Nelson

    11 years ago

    I suppose it all depends on how the term government is defined. God governs. Government is just that – a governing body. So, without the most basic of government (people being willing to govern themselves) the result is chaos, yes.

    The institution we typically call government is not a “them” it is an “us.” It is only when we divorce ourselves from our responsibility to self-govern that the institution of government fails to “protect inalienable rights or maintain laws for free markets.” Government is what we make of it, because it is merely an outward manifestation of our ability and willingness to self-govern.

    The contradiction to which I was referring is stated in my previous comments. You say one can’t limit what one calls government, then you do just that – limit what one calls government.

    Thank you for your thoughts as well.

  10. Kris Bayer

    11 years ago

    Thanks for your thoughts. If you do not mind, let me see if I can clarify. I like that you say there are different ways of defining the word government. I agree God governs. I also believe that he created our universe with law that exists whether we believe it to be true or not. Also, we learn that law as we live our lives. If we govern our self by His laws we do well, if we choose not to then things do not work out so well. Like humans trying to fly off a building.

    I used to believe that the US corporation we usually call the government here in America was a reflection of the people’s character. Today I think there are two forces at play vying for the control and influence over our lives thru various regulations. the people, “us”, and those in control who want to control the “us”. The power seekers will not be limited by the constitution, the political laws in place or anyone telling them to stop. They have become arrogant bullies. The incentives in place benefit the controllers and they know it. They also know that the “us” is generally apathetic.

    People generally do things that benefit themselves and stop doing things that hurt such as touching a hot stove or stepping on stickers in the yard. Unless you have no feeling in your feet, you would go get shoes. Life teaches us God’s law whether we acknowledge God or the law. The political machine we usually call government is unnecessary and harmful to the advancement of any society. The one in this nation today cannot be limited or made to be small again. We need to be free of the tyrant. Chaos does not necessarily result. People can figure it out.

  11. Ammon Nelson

    11 years ago

    I’m glad to say we agree on almost everything. I also believe that the universe has laws that exist whether we believe them or not. I call these principles or natural law. I believe one of these principles is that to secure the unalienable rights with which God has endowed all men, “governments are instituted among men, deriving their just powers from the consent of the governed.”

    I think you may have understood differently than I intended. When I say that government is an outward manifestation of our ability to self govern, I am not just referring to the US government, which is representative in nature. I am referring to whatever form of government exists. When we choose to not self-govern, the outward manifestations will conform. Not that they mirror what the people do, but that they conform to fit what the people do. The degree to which the people self-govern determines the degree to which the government adjusts to that degree of self-government.

    When you speak of the people in control that want to control the “us.” You are creating a straw man against which to debate, rather than a real human being. There is not a single human being who completely matches the description you use.

    I do agree, however, that there are two forces vying for control of our lives. These are not people or groups of people, but forces. They are the same forces or human propensities spoken of by many philosophers throughout history. Nietzsche called them the Dionysian and the Apollonian. James Bryce in The American Commonwealth describes them as centrifugal and centripetal forces.

    This is not to say that there are not evil, conniving people in the world. They only have power when everyone else is apathetic, or gives up on enforcing the common standard of behavior and living so that the natural law benefits them.

    I have heard the arguments you make about the unnecessary nature of government. I simply don’t agree. When each individual is left to determine how best to act for themselves, without any common rules for behavior, there is a lack of organization. To say that “people will figure it out,” is to me like saying that ink, if you remove the bottle, will automatically write a novel.

    I also disagree that the political form established by the US Constitution cannot be limited or made to be small again. I think what you are intending when you say that is that the Federal government will not restrain itself back to the limits within which it has been kept before, by itself. I agree with this sentiment, but that is the beauty of our current system. it is not up to the Federal government to limit itself. That is our responsibility.

    You mention that those in control know that the “us” is generally apathetic. I agree that there is a lot of apathy in our nation and world right now. Just the other morning I listened to a caller on a radio show complain about needing to keep track of what our legislators are doing, saying that it is asking too much for us to hold our elected representatives accountable; giving a victim’s story about how politicians are “paid to do that sort of thing” and that the rest of us are too busy and lack the resources to do it. I shuddered.

    When a garden is over-run with weeds, the solution is not to remove the garden, it is to remove the weeds and address the attitude which led to out of control weeds. The same solution applies to our government. The solution is not to remove the source of order in our society, the solution is to remove the apathy, through education.

    Like Gandhi taught, we need to begin change by changing ourselves, so I am doing my best to overcome my own apathy and lack of action. My wife and I, with some friends are starting a book discussion group to encourage and inspire each other to pursue lifelong learning.

  12. Kris Bayer

    11 years ago

    So I guess the questions are, what is the form that people need in order to thrive. Or, what is the form that allows human beings to be the best we can be. And, does that form exist already and our job is to discover it. Or, does that form need to be created by human beings. So many questions!

  13. Keith

    11 years ago

    To thrive and be the best, every human being needs to have the freedom to rise up and do something. This means an entirely new shift away from responsibilities maintained at a distance (the Platonic way) and shifting to the local arena (the Socratic way), where there is a greater decentralization of control. More local responsibility over health, education, welfare is the path. When conservatives fight the state from taking these responsibilities, they lose because they offer no solution other than personal responsibility. This is the biggest mistake conservatives make. They fight the state with the mantra of individualism and not as families and communities. And the biggest mistake the liberals make is that while winning the argument for solving for social responsibility, they refuse to recognize the power and vision that comes from individuals. The above sound likes a paradox, but it is not. I would spend more time elaborating but I hope you see it.

  14. Kris Bayer

    11 years ago

    I like your perspective, Keith. I think I see, but I find myself asking How? With all the regulations, etc. I find myself hindered at every step. All the rules and regulations hinder the progress. Without seeing a solution to this, I find that maybe becoming more aware of the situation we are in (going to the council and commissioners’ meetings and watching local court proceedings), I would then find a way.

  15. Ammon Nelson

    11 years ago

    I like your perspective as well Keith. I agree that local control of all these things is the direction that needs to be taken.
    I have been studying and trying to work toward that solution, but find myself woefully under-educated and inexperienced about how to actually accomplish this.
    How do we step out of the abstract realm of ideas and make this a reality?

  16. Keith

    11 years ago

    We have to start writing about the future and not the past. The past is all about fighting for freedom and liberty. The future is about responsibility and liberty. I define liberty as the hand that adds value. It is a predicate act and not a passive state. When you take responsibility you are free. I do not mean personal responsibility. I mean whole families and whole communities taking responsibility en-mass. When they take responsibility each individual within has great liberty given to them. My best answer to start this is to create a new media online, a media that is a kind of open source digital republic that decentralizes control while liberating each voice. If it was not for the diverse ownership of media the founders had with their press, nothing would have happened. We have the Internet and the ability to code in any way we want to account for more freedom, but sadly developers simply cannot see the idea. I have spent four years on this and I am at a loss as to how to fund it any further. Meanwhile, I write under a pen name just to get better and better at it, I also spend time searching for funding to get the technology completed. You can see the current state of the project at hotzing.com.

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